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    Policy Options: Subsidies

     

    Table 1. Types of energy subsidies

    Government intervention Example
    How the subsidy usually works
    lowers cost of production raises cost of production lowers price to consumers
    Direct financial transfer

    Grants to producers

    Grants to consumers

    Low-interest or preferential loans to producers

    x

     

    x

    x
    Preferential tax treatment

    Rebates or exemptions on royalties, duties, producer levies and tariffs

    Tax credit

    Accelerated depreciation allowances on energy-supply equipment

    x

    x

    x

    x
    Trade restrictions Quotas, technical restrictions and trade embargoes
    x
    Energy-related services provided directly by government at less then full cost

    Direct investment in energy infrastructure

    Public research and development

    x

    x

    Regulation of the energy sector

    Demand guarantees and mandated deployment rates

    Price controls

    Market-access restrictions

    x

     

     

    x

    x

    x

     

    x

    Table from Reforming Subsidies, page 10

     
     



    Updated: 2016/06/30

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